Chapter 12, Problem 12.4CTF

Summary Introduction

To discuss: The relationship between risk and reward (return).

Introduction:

Risk refers to the movement in the value of an investment. The movement can be positive or negative. The investor will gain if the movement is positive, and the investor will lose if the movement is negative.

Returns or rewards refer to the income that the investor earns from an investment. The return can be a capital gain or a periodic income.